Deception? Getty Images & The Pinterest Deal

The Carlyle Group owned Getty Images may be operating in a deceptive manner as it relates to the reporting of income, sales, and licensing of content under their recently announced deal with Pinterest. Under the now private ownership of The Carlysle Group, very little about the business dealings of Getty Images is available, but from time to time, interesting news can slip out.

Let's first look at Getty's blog post announcing the deal. Here are several relevant excerpts from the blog post about just what Pinterest is paying Getty for - Metadata only:

"Getty Images and Pinterest have struck a multi-year deal to drive a more visual world by combining our rich metadata and compelling content ..."

Metadata makes an appearance in the above quote, followed by an aggrandizing comment about the "fantastic Getty Images photographer..." and details on the information (that is, metadata) about the designer of the boots that appear in the photo:

"Let�s say you�re browsing Pinterest and see an image of Beyonce wearing totally fierce boots. But there�s no information about who designed them or where you can get them! It may also be hard to find out that a fantastic Getty Images photographer shot the picture."

Now, Getty makes it clear that the metadata is what's being sold/licensed, and that the photo then gets "photo credit" and a link.

"Our new partnership with Pinterest offers a solution....we�ll use our API, Connect, to provide relevant metadata to Pinterest � including Getty Images photo credits, where and when the image was shot and more. We�ll get a photo credit for our images on Pinterest�s site and a link back."

Here, Getty makes it clear that the payment is only for metadata. The below statement is as definitive as President Obama's statement regarding healthcare that if you like your doctor or health care plan, you can keep it. There's no question or equivication - Getty's getting paid "for this rich metadata":

"Pinterest will pay Getty Images a fee for this rich metadata, which we�ll share with contributors. "

If a photo licenses for $1.00, what do you suppose the metadata would license for? $0.01? $0.10? Certainly, the figure is a fraction of what the image would license for, and then, that fraction of the photo licensing income is shared at Getty's disproportionate percentage split in their favor.

Nowhere does Getty state that Pinterest is paying for an image license.

Why is it important then, that Getty make it crystal clear that the payment is for Metadata? Let's look closely at a few sections of Getty's contract with contributors.

First Getty details that the agreement is for "Accepted Content" and then defines what "Accepted Content" is:

"This Agreement applies to all Content (as the term is defined in Section 1.2) that you have previously submitted and, in the future, will submit, that is accepted for distribution by Getty Images (�Accepted Content�). "

"1.2 Types of Content: This Agreement will apply to the following types of content (the �Content�): (a) photographs, illustrations, or other still visual representations (�Still Image(s)�); (b) moving visual content in any form including, film, video tape, digital files, animation and clips (�Footage�); and (c) font, audio file and any other work protected by copyright, in all cases, generated by any means and in any format or medium, including any reproductions and any modifications and derivative works thereof. "

It's clear there, above, that the content is "photographs" - not metadata. Below, Getty first states what should be obvious - that you own the rights to your "Accepted Content", however, Getty then goes on to make it perfectly clear that "Getty Images will own all right, title and interest, including all copyrights that arise apart from the copyright in your Accepted Content, to all types of derivative works created by or for Getty Images that contain multiple items of Accepted Content and/or other Content:"

1.13 Copyright to Accepted Content and other Works. Subject to the rights granted in this Agreement, you will retain all right, title and interest, including copyright, in all Accepted Content including when it is incorporated in a derivative work created by others. Getty Images will own all right, title and interest, including all copyrights that arise apart from the copyright in your Accepted Content, to all types of derivative works created by or for Getty Images that contain multiple items of Accepted Content and/or other Content. Either you or Getty Images on behalf of you may register the copyright in any Accepted Content with the relevant copyright authority.

Again, contributors are being compensated for a fraction of a metadata fee rather than a fraction of a photo licensing fee, because Getty has made it perfectly clear that they're only being paid for metadata.

Until yesterday.

(Continued after the Jump)

At a conference held here in the Washington DC area, the US Patent and Trademark Office held a conference - "Copyright Policy, Creativity, and Innovation in the Digital Economy" (details here) for a day-long conference. I watched the webcast, and participating in the conference was John Lapham, Senior Vice President and General Counsel for Getty Images.

Here's the video: If you scrub forward to about 19:10 in the video, the discourse on this subject begins.

Lapham first states regarding the Pinterest deal:

"....a healthy percentage of their content belonged to Getty Images contributors, and rather having a slap flight about what should and should not happen with pictures on their site, to say, as pictures are moved around, you lose the metadata, you lose the attribution. and instead of yelling at each other about whether or not you should be licensing pictures or not, let's reattach the metadata properly to those images, and let's have our contributors in turn receive the royalties that they are due for the use of their content. That was the goal in reaching that type of arrangement..."

The moderator Ann Chaitovitz, Attorney-Advisor for Copyright, Office of Policy and International Affairs, USPTO, presses Lapham, because all of the previous statements by Getty have been that payment by Pinterest was for metadata only. So she re-asks:

"Thank you. umm, so can I, just to clarify my understanding, it was, metadata - you re-attach the metadata, was their also a kind of a payment, or was that for, they would be tagged for future uses they would have the metadata?"

Lapham responds:

"Uhh, the arrangement works so that, uh, as, we have a database, an imagery database, that contains, you know, tens of millions of pictures, not only of ours, but of competitors, of other companies, and we can match that database of images up against a website to find out what the matches are. And so using that image recognition technology, we can say, you know, we can say, looking at the USPTO website for instance, that you have 110,000 Getty Images photos on there, and those images no longer have their metadata, we'll re-attach that metadata and the fees that can be charged for that can be on a per image per month basis so that the individual who created that work is in turn being compensated back for that."

Lapham makes several points. In his initial statement:

"let's have our contributors in turn receive the royalties that they are due for the use of their content."

He then states in his follow up:

"we'll re-attach that metadata and the fees that can be charged for that can be on a per image per month basis so that the individual who created that work is in turn being compensated back for that."

So, the fee being charged is for re-attaching the metadata? When he says "the fees that can be charged for that", he's clearly referring to the action earlier in the sentence "we'll re-attach that metadata..." and then, does the "compensated back for that" at the end of the sentence - does the "that" refer to their being the one who "created that work" or the re-attaching?

Why is this important? Well, in the Getty Images contract, Contributors transfer their right to sue (and/or settle) an infringement claim:

1.11 Right to Control Claims. Getty Images shall have the right to determine, using its best commercial judgment, whether and to what extent to proceed against any third party for any unauthorized use of Accepted Content. You authorize Getty Images and Distributors at their expense the exclusive right to make, control, settle and defend any claims related to infringement of copyright in the Accepted Content and any associated intellectual property rights (�Claims�).

We're asking a nuanced - but very serious question here. Lapham makes it clear that a healthy percentage of images on Pinterest are Getty's contributor images. Up until the deal, the presence of those images were infringing on the copyright of the owners of the images. Getty stated they didn't want to get into a "slap fight" with Pinterest. We're talking about millions of images, and the difference between what a photographer would receive as a portion of metadata fee versus a portion of income from an image license could mean millions more dollars in Getty's coffers at the expense of the contributors, just because of how the agreements between Pinterest and Getty, and between Getty and it's contributors, are written.

It would seem to me that it's deceptive to announce a deal where income comes from metadata, but then to -- in a not-as-widely-distributed forum where the message isn't massaged by countless re-writes of a press release -- to get a different answer that Getty may well actually be getting paid image licenses, for which they would, in turn, owe contributors the higher figure. Clearly the moderator had a different understanding going into the question, and she's a well regarded attorney advising the government on intellectual property matters, so it's not an insignificant detail that she's confused by what Lapham said as incongruous with the previously announced deal.

So, the question on the table that Getty Images contributors are due an answer to is "Are we being compensated for our Accepted Content (i.e. photographs) or are we being compensated for the metadata?" Lapham made it clear that they are due their royalties for the use of their content.

The follow up question is - "How much is the gross income per photo licensed, and how much is the gross income for the metadata fee for re-attachment and display?"